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David Fry
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David Fry writes a subscription newsletter focused on technical analysis of exchange-traded funds, called ETF Digest (www.etfdigest.com). Dave founded the ETF Digest in 2001 and was among the very first to see the need for a publication that provided individual investors with information and... More
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  • INVESTORS FACE A WEEK OF WHIPSAWS 0 comments
    Apr 19, 2012 7:58 PM | about stocks: SPY, IWM, QQQ, AAPL, QCOM, AMD, MSFT, SOXX, IGV, GSK, XBI, BAC, MS, XLF, ITB, IEF, TIP, UUP, FXE, GLD, GDX, SLV, JJC, DBC, USO, UGA, DBA, EFA, EEM, EWJ, EWU, EWP, EWG, EWQ, EWH, EWZ, RSX, EPI, FXI

    openingimage

    Stocks didn't like earnings news and economic data overall. In the eurozone, Spain sold some 10 year debt (mostly to Spanish banks and perhaps the ECB) at levels below 6% but only to see prices fall and yields rise in the secondary market. Equity indices in the eurozone were markedly weaker. Polling in France shows Sarkozy no doubt losing to the socialists which would mean austerity agreements would go out the window.

    Earnings reports focused primarily on Morgan Stanley (MS) and Bank of America (BAC). Frankly, one would need a forensic financial archeologist to wade through the release to find the "real deal" from each company. The standout category had to do with both company's DVA (Debt Value Adjustments). Both companies bonds are being revalued lower. As a book entry trick the company's may then deduct the loss in value of their own debt against earnings. MS after all is facing a three notch downgrade from Moody's as I understand it. After all these deductions were counted both companies could then report slightly positive earnings in lieu of losses: BAC $25 (stock slightly lower by 1.60%) and MS $.71 (stock higher by 2.25%).

    <READ MORE>

    Themes: ETFs, ETF, Exchange Traded Funds Stocks: SPY, IWM, QQQ, AAPL, QCOM, AMD, MSFT, SOXX, IGV, GSK, XBI, BAC, MS, XLF, ITB, IEF, TIP, UUP, FXE, GLD, GDX, SLV, JJC, DBC, USO, UGA, DBA, EFA, EEM, EWJ, EWU, EWP, EWG, EWQ, EWH, EWZ, RSX, EPI, FXI
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